Psychological Indicators for Retail Sales and GDP
Survey-based indicators have been developed by foreseechange which are correlated with retail volume growth, household consumption expenditure volume growth, and GDP volume growth.
These indicators are valuable in several ways:
ˇ They provide insight into the consumer psychology which drives consumer spending, which contributes over 50% of GDP;
ˇ This insight is vital in terms of influencing and forecasting consumer spending;
ˇ They provide an independent, timely input to forecasting, especially given that national accounts data is released some two months after the end of a quarter and is subject to revision three months later;
ˇ Being survey-based, these indicators can be broken down by area and demographic so that these can be ranked by contribution to growth contribution. This means that advertisers can target the biggest contributors to growth. Also, the relative attractiveness of catchment areas to retailers can be assessed.
How well our indicator for total retail sales volume fits actual growth is illustrated in the chart. This indicator is based on two survey questions and 87% of variance is explained.
Similar indicators, based on our set of survey questions, have been developed for food retail volume, department store volume, café and restaurant volume, household consumption expenditure, and GDP.
Updating the indicators
The next update will be in November 2013 and the results will be available by the end of the month at www.foreseechange.com.au. This will provide the basis for a forecast of 2013/14, along with insights into the current consumer mindset.
Key issues which will be addressed by these indicators and other survey measures are:
The report will also provide the basis for the indicators.